It may be hard to believe, but there are still millions of Americans who are being charged for “leasing” a telephone from what was formerly AT&T. When AT&T was broken up in the mid-1980s, customers were given until the end of 1987 to opt out of their telephone leases and buy their phones. Those who did not do so continued to lease the phones from a new entity, now known as QLT Consumer Lease Services.
Most of QLT’s customers are elderly, and no longer even have the rotary phones they began leasing decades ago. And most of them have no idea that the quarterly bills they are receiving from QLT are actually rental fees that over the years have added up to sometimes thousands of dollars.
QLT defends its business model by pointing out that its customers are entitled to free replacement of any phones that malfunction, and free accessories such as long cords. But since QLT charges $71.40 per year to rent a standard telephone, its customers could afford to buy several new phones and cords every year if they were not paying QLT.
Although the company admitted no wrongdoing, a class action settlement of $350 million was set aside in 2002 to compensate people who had been overcharged for rental payments which vastly exceeded the cost of their telephone equipment. It was estimated that there were 30 million class members entitled to compensation. However, only 92,000 claims were filed, with payouts ranging from $15 to $80, depending on the length of the lease and the number of phones involved. Only $8 million has been paid out to consumers, while lawyers have received between $50 million and $80 million, and $50 million has been given to charity in the form of calling cards. The calling cards expired at the end of six months if they were not used.
However, QLT continues to do business, and there are apparently over one million customers who continue leasing their phones. You can visit QLT’s website if you would like.
Kathleen,
Can QLT customers still make claims on the class action suit or is it too late?
Thanks for this article you posted.
Lee
Thanks, Lee. I have tried to find out something concerning the claims process for the class action suit, but so far have had no luck in tracking down anything. I did read about a reporter who contacted Lucent Technologies, which was a defendant in the suit, and was able to get a settlement of $150 for his mother. Possibly, contacting the legal department at Lucent would be a starting place, although I haven’t tried that yet. I’ll see what I can find out, and post an update. Thanks again for your interest.
Kathleen Munden